CLA-2 RR:CR:TE 961942 SS
Port Director
U.S. Customs Service
135 High Street, Room 350
Hartford, CT 06103
RE: Decision on Request for Internal Advice 30/97 concerning the classification of small clutch purses; Handbags; Subheading 4202.21.6000, HTSUSA; Articles of A Kind Normally Carried in the Handbag; Subheading 4202.31.6000, HTSUSA; Wallet
Dear Sir:
This is in response to your letter dated September 18, 1997, requesting Internal Advice regarding the classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), of two styles of small leather clutch purses. The Request for Internal Advice was initiated by Meeks & Shepard on behalf of Buxton Company. Two samples, identified as model 39 and model 54, have been submitted.
FACTS:
The sample article, identified as model 39, is a small leather clutch purse with an outer surface composed of leather. Model 39 is also identified by the importer as an “Ensemble Clutch”. The item measures approximately 4 inches in height by 7-1/2 inches in width and 1 inch in depth when empty and in the closed position. A metal zippered closure extends along three sides of the item’s central compartment. When unzipped, gussets allow the top opening of the compartment to expand approximately 6 inches. The inside of the central compartment is divided into two smaller gusseted compartments by a zippered pouch that runs the width of the compartment. The central compartment can hold small three-dimensional items. There is a single full-width slot compartment on each inside wall of the compartment. One wall also features four slots for credit cards or similar objects. The front exterior of the article consists of a flap that folds in a bifold manner and is secured in the closed position by a strap approximately 1-1/4 inches wide and 2-1/4 inches long with a metal three positioned snap fastener. When the fold-out flap is in the open position, the article measures approximately 8 inches in height. The interior of the flap contains one slot compartment extending the full width of the article and six slots sized to contain credit cards and similar objects. Inserted permanently into the full length slot is a check book cover. Also inserted into the full width slot are 5 transparent envelopes for photos or credit cards. The spine of the flap has an opening allowing for the storage of a pen. The interior side opposite the flap features one full-width slot compartment and a transparent flat slot pocket for an identification card. The rear exterior features a zippered compartment that extends across the width of the article. The zippered compartment is gusseted on one side which allows one side of the opening to extend approximately 2 inches.
The second article, model 54, also has an outer surface composed of leather. The item is identified as a “Double Flap Clutch”. The item measures approximately 4 inches in height by 6-3/4 inches in width and 1 inch in depth (at its thickest point) when empty and in the closed position. The front exterior of the article features two overlapping flaps that are secured with metal snap fasteners. The first, or top flap, opens to reveal a gusseted compartment. The gussets allow the top opening to expand approximately 2 inches, allowing for easy access to the compartment. However, the snap closure restricts the carrying capability of this compartment to a thickness of approximately 1/2 inch. Towards the rear wall, there is a single zippered compartment. The rear of the zippered compartment creates a flat slot compartment against the rear wall. The second, or lower flap, secures a fold-out flap. When the fold-out flap is in the open position, the article measures approximately 7 1/4 inches in height. The interior of this fold-out flap contains two full width slots. The interior of the article opposite the fold-out flap contains two full-width slots, a transparent flat slot pocket for an identification card and five slots for credit cards or similar objects. The rear exterior features a full width slot compartment.
In the Request for Internal Advice, the importer asserts that both models are designed and marketed as ladies wallets. The importer has submitted three affidavits of persons in the leather goods industry who have attested to the fact that the articles are wallets as opposed to handbags. The importer has also submitted retail advertisements which suggest that the articles are sold in the small leather goods departments of stores. Additionally, we met with counsel and a representative of the importer on December 21, 1998. We note that the importer made a supplemental submission dated February 19, 1999.
ISSUE:
Whether the merchandise is properly classified in subheading 4202.31, HTSUSA, as articles of a kind normally carried in the pocket or in the handbag; or in subheading 4202.21, HTSUSA, as handbags?
LAW AND ANALYSIS:
Classification of goods under the HTSUSA is governed by the General Rules of Interpretation (“GRIs”). GRI 1 provides that classification shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI may then be applied. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, and any related subheading notes and, mutatis mandis, to the GRIs. This matter is governed primarily by GRI 6, in that the choice in classification is between two subheadings. Heading 4202, HTSUSA, provides for, inter alia, travel bags, handbags, wallets, purses and similar containers. Since the merchandise is similar to handbags and/or wallets, it is covered by the heading. Subheading 4202.21, HTSUS, covers handbags with outer surface of leather while subheading 4202.31, HTSUSA, covers articles of a kind normally carried in the pocket or in the handbag with outer surface of leather. Accordingly, classification in this case depends on whether or not the items are considered handbags or articles normally carried in handbags.
The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI. The EN to subheading 4202.31, HTSUSA, the provision for articles normally carried in a handbag, states that the subheading covers “articles of a kind normally carried in the pocket or in the handbag and include spectacle cases, note-cases (bill-folds), wallets, purses, key-cases cigarette-cases, cigar-cases, pipe-cases and tobacco-pouches.” Since subheading 4202.21, HTSUSA, explicitly covers handbags and the EN to subheading 4202.31, HTSUSA, indicates the subheading specifically covers wallets, we must decide whether the articles are handbags or wallets.
On June 21, 1995, this office published a General Notice in the Customs Bulletin, Volume 29, Number 25, concerning goods identified as “Wallets on a String.” The attributes of both handbags and articles of a kind normally carried in the handbag were discussed. With regard to articles of a kind normally carried in the handbag, the notice stated in pertinent part:
“Such articles include wallets, which may be described as flat cases or containers fitted to hold credit/identification cards, paper currency, coins and in some instances a checkbook holder.
In order to be classified as a flatgood, the article must fit comfortably in a handbag or pocket. For example, rectangular or square cases measuring approximately 7 1/2 inches by 4 1/2 inches, or 4 3/4 inches by 4 1/2 inches, in their closed position, have been classified as flatgoods.
The addition of a wrap-around zipper does not in and of itself transform a flatgood into a handbag, particularly where the zipper functions merely to secure its contents in the closed or carrying position. Specifically, the presence of a zipper which simply holds the two halves of a wallet or similar container together, so that cards, currency or other articles in fitted compartments do not fall out, does not transform the case into a handbag.”
With respect to handbags the notice stated:
“A hand bag functions as a carry-all container for various small personal effects:
A container which is not fitted to hold articles such as credit/identification cards, paper currency, coins or checkbook holder is classifiable as a handbag. Therefore, a clutch bag or an evening bag measuring, for example, 7 1/2 inches by 4 1/2 inches, shall be classified as a handbag.
The determinative feature of a handbag is its ability to hold several objects not associated with a wallet. A bag which may accommodate articles such as a hairbrush, cosmetics, keys or other loose personal effects shall be classified as a handbag, even if it also incorporates the features of a flat case fitted to hold the items set forth above.
The presence of gusseted and/or zippered compartments will be taken into consideration in a determination of whether a case has generic carrying capacity. The presence of a wrap-around zipper may be an indication that the container is a carry-all if the zipper creates an inner space suitable for carrying three-dimensional objects.”
In Headquarters Ruling Letter (HRL) 959919, dated January 26, 1998, we discussed the fact that the term “wallet” is not defined in the HTSUSA, nor in the applicable EN, but noted the following definitions from lexicographic sources:
“Essential Terms of Fashion: A Collection of Definitions, Charlotte M. Calasibetts, Fairchild Publications, 1986; an item used to carry paper money, credit cards, photographs and sometimes with a change purse or space for a check book or pad.
The Fashion Dictionary, Mary Brooks Picken, Funk & Wagnalls, 1973: 1. Flat purse or pocketbook, for carrying either paper money or coins.
Webster’s New Collegiate Dictionary, G. & C. Meriam Co., 1977: 1. A bag for carrying miscellaneous articles while traveling; 2A. billfold B. a pocketbook with compartments for change, photographs, cards and keys.
Webster’s New World Dictionary, Third College Edition, Simon & Schuster, Inc., 1988: 1. [Archaic] a knapsack; 2. A flat pocketbook, as of leather, with compartments for paper, money, cards, etc.; billfold.”
With respect to model 54, we note that the article is fitted to hold items such as credit cards, identification cards, paper currency, and is capable of being carried in a handbag. We find that the article is not designed to hold 3-dimensional items and will be principally used as an article carried in the handbag. The gusseted compartment, although it expands to a width of 2 inches, does not provide a generic capacity for loose personal effects. If 3-dimensional items are placed into the gusseted compartment, the compartment will not snap shut. If forced, the snap may engage, but the clutch noticeably bulges where the 3-dimensional articles are located and appears awkward. Thus, we conclude that model 54 is most specifically described by the term “wallet”.
Model 39, however, is not so easily classified. The three-sided zipper and generous gussets make the determination difficult. Furthermore, a portion of the challenge in classifying articles that walk the fine line between “handbag” and “wallet” is due to the difficulty in visualizing items covered by prior rulings despite the detailed descriptions provided. However, we were able to locate three rulings and two samples on almost identical merchandise which all found that the items involved were classifiable as handbags.
The description of the “Zip Clutch”, the article involved in HRL 960180, dated August 12, 1997, indicates that the item classified as a handbag is almost identical to Model 39. The “Zip Clutch” was described as having very similar dimensions and features as model 39. The “Zip Clutch” was fitted to hold items such as credit cards, paper currency, and photos, and was of a size suitable for carrying in a handbag. However, Customs determined that the article was also designed to hold 3-dimensional items not associated with the capacities of a flatgood. In classifying the “Zip Clutch” as a handbag, emphasis was placed on the three-sided zippered compartment with gusseted pockets which provided a generic carrying capacity for a variety of loose personal effects (e.g., lipstick, pens, a set of keys, etc.).
A review of HRL 959509, dated February 25, 1999, indicates that sample item Y8940B was similar to model 39. Upon examining the sample, we discovered that the merchandise was almost identical. Y8940 had approximately the same dimensions and features as model 39. The article had a similar central compartment which was zippered on three sides and opened to reveal a double gusseted, full-width pocket that was divided by a zippered flat pocket. Customs found that the article was designed to hold 3-dimensional items not associated with the capacities of a wallet or flatgood. In classifying Y8940 as a handbag, Customs focused on the large gusseted pocket which expanded to a width of 5 inches and provided a generic carrying capacity for loose personal effects such as a small hairbrush, set of keys, cosmetics, etc.
Similarly in HRL 959512, dated February 25, 1999, the description of item PLDFN 9520 indicated that the ruling covered similar merchandise and an examination of the sample involved revealed almost identical merchandise. The “additional zippered compartment which opens to reveal a double-gusseted, full width pocket with a divider” described in the ruling was zippered on three sides similar to model 39. Customs determined that PLDFN 9520 was designed to hold 3-dimensional items not associated with the capacities of a wallet or flatgood. In classifying PLDFN 9520 as a handbag, Customs stressed the fact that the gusseted pockets provided a generic carrying capacity for loose personal effects.
Based on the three prior rulings involving almost identical merchandise, model 39 is classifiable as a handbag. Model 39 has a three-sided zippered compartment with a double gusseted full width pocket that creates an inner space suitable for carrying 3-dimensional objects. The generic compartments make model 39 capable of holding several objects, other than those associated with a wallet, and, thus, model 39 functions as a carry-all container for various small personal effects. In conclusion, model 39 meets the description of a handbag as set forth in the guidelines dated June 21, 1995.
HOLDING:
As per the analysis discussed above, model 54 is properly classifiable in subheading 4202.31.6000, HTSUSA, as an article of a kind normally carried in the pocket or in the handbag with outer surface of leather. The general column one rate of duty is 8 percent. Model 39 is properly classifiable in subheading 4202.21.6000, HTSUSA, as a handbag with an outer surface of leather if valued not over $20 each. The general column one rate of duty is 10%.
You are to mail this decision to the internal advice applicant no later than 60 days from the date of this letter. On that date, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
John Durant, Director
Commercial Rulings Division